Brazilian Transfer Pricing Developments: One Giant Step?

Podcast on new transfer pricing system for Brazil and the potential impact on taxpayers with Brazilian operations

Kimberly Majure

Kimberly Majure

Principal, International Tax & Legal Operations Transformation Services, KPMG US

+1 202-533-5270

Kortney Wallace

Kortney Wallace

Principal, International Tax, KPMG US

+1 313-230-3056

Roberto Salles

Roberto Salles

Partner, International Tax, KPMG in Brazil

KPMG Destination Country X

Episode 04-2022 | Sometimes on a long journey, the first step is the hardest. After a long history of Brazil’s transfer pricing regime walking its own path, Brazilian tax authorities have announced a significant change in direction. In a joint presentation with the Organisation for Economic Co-operation and Development, the government announced expectations for a new transfer pricing system for Brazil.

U.S.-based multinationals that are facing challenges in fitting the current Brazilian rules into the new U.S. foreign tax credit rules are breathing sighs of relief.  But…there’s a long way to go to secure creditability of Brazilian taxes, even if expectations come to fruition, as the announcement only covered changes needed for Brazilian income tax to be creditable; issues with the Brazilian withholding tax remain unaddressed.

Roberto Salles, International Tax partner from KPMG in Brazil, joins podcast hosts Kimberly Majure and Kortney Wallace to discuss what’s been said, what has not, and what it all may mean for taxpayers with Brazilian operations.


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Brazilian Transfer Pricing: Here Today, Gone Tomorrow?
June 3, 2022 | In this article, the authors provide an overview of the new Brazilian transfer pricing system envisioned by the OECD and the Brazilian Federal Tax Authorities, which represents a complete departure from Brazil’s old system. The newly announced transfer pricing regulations would be an improvement for U.S.-based multinationals — particularly those seeking foreign tax credits under the new regulations — but there is still uncertainty whether holistic consistency between the Brazilian and U.S. income tax systems (and correlative creditability) can be achieved. | Tax Management International Journal